Canada Post recorded a loss before tax of $160 million in the second quarter of 2022 as a slow-down in Canadians’ online shopping led to a decline in revenue for parcels and transaction mail.
For the first half of 2022, the Canada Post segment recorded a loss before tax of $289 million, which was $61 million more than the $228 million loss posted in the same period a year earlier. Revenue fell by $218 million, or 5.0%, compared to the first half of 2021.
For both the second quarter and first half of 2022, parcels revenue declined as Canadians’ online shopping slowed from COVID-elevated levels a year earlier.
Transaction mail volumes and revenue were down also.
On the upside, direct marketing continued to recover compared to the previous year, even though consumers and businesses pulled back on spending due to uncertainty about the economic outlook.
Cost of operations improved by $84 million, or 4.3%, for the second quarter compared to the same period a year earlier. For the first half of 2022, costs improved by $161 million, or 3.3%, year-on-year (y-o-y).
Canada Post said the cost decreases were largely driven by lower labour and employee benefits due to parcel volume declines, while transportation and facilities costs rose.
Focusing on the different sectors, parcels revenue declined by $79 million or 7.3% in the second quarter, while volumes fell by 27 million pieces or 27.9% y-o-y.
Transaction mail revenue fell by $28 million or 2.9% y-o-y in Q2, as volumes declined by 59 million pieces or 8.1%.
Direct Marketing revenue rose by $24 million or 13.2% y-oy in Q2, as volumes increased by 140 million pieces or 16.7%.